Ackman's Pershing Square Returns to Netflix After Past Loss, Declares It 'Has Won the Streaming War'

Billionaire Bill Ackman's Pershing Square held Netflix (NFLX-US) briefly in 2022 before selling at a loss, but the hedge fund disclosed on Wednesday (12th) that it has recently bought back shares of the streaming giant.

According to Pershing Square's latest semi-annual report, as of June 30, it held 3.15 million shares of Netflix, representing 4.9% of its portfolio. Other newly established positions include Visa (V-US), Mastercard (MS-US), S&P Global, Intercontinental Exchange (ICE-US), and Alcon (AA-US), with ICE and Alcon positions built after June 30.

In early 2022, Pershing Square invested over $1 billion in Netflix, but exited just months later at a loss exceeding $400 million after Netflix reported its first subscriber decline in decades.

Pershing Square stated in a release: 'Netflix has now effectively won the streaming war.' The firm expects Netflix's revenue to continue growing at a double-digit percentage rate, while content cost growth will lag behind revenue growth, further driving margin expansion. Pershing also believes Netflix's current valuation multiples remain significantly discounted compared to peers.

Microsoft (MSFT-US) remains Pershing's largest holding with 1.52 million shares, accounting for 12.4% of the portfolio. Uber (UBER-US) is the second-largest holding with 7.63 million shares, representing 12%. Meta Platforms (META-US) is third with 913,500 shares.

This report marks the first portfolio disclosure since Pershing Square's U.S. entity began trading on the New York Stock Exchange (NYSE) in late April. Pershing noted that from its listing date through August 11, the net return on its portfolio holdings was 0.6%.